Employment practices liability (EPLI): driver lawsuits it covers, and the pay claims it leaves out

What EPLI pays for

EPLI responds to claims that come out of hiring, managing, and letting people go. The claims insurers see most are wrongful termination, discrimination, sexual harassment, and retaliation. Policies also reach defamation, invasion of privacy, failure to promote, and similar workplace complaints, and they cover the company’s officers, managers, and employees as insureds. Coverage pays the cost of defending the suit plus damages up to the limit.

Workers filed 88,201 discrimination charges with the EEOC in fiscal 2025, and 37,397 of them alleged harassment, up from 35,774 the year before. Not counting lawsuits, the agency’s charge process recovered $528 million for workers that year. In NEMT work, the usual flashpoints are the ones in firing a NEMT driver and harassment prevention training.

Maryland’s insurance regulator lists what drives the price: how many employees you have, your history of employment claims, and other risk factors in the business. It also notes that punitive damages are generally not covered, though some insurers sell that protection for added premium.

The exclusions that matter for a van company

Three gaps decide whether an EPLI policy fits a NEMT operation:

• Wage and hour claims. Most policies specifically exclude them because overtime suits are often brought as class actions for large sums. Disputes over unpaid wait time or split shifts usually fall here, covered in NEMT driver overtime.
• Bodily injury and property damage. These are among the most common exclusions, along with intentional or dishonest acts. Injuries belong to workers’ comp and your liability policies.
• Claims by riders. A standard EPLI form answers claims by employees. Claims by riders, facility staff, or vendors against your drivers need third-party coverage, discussed next.

Third-party coverage for rider complaints

Third-party coverage handles claims brought by nonemployees, such as customers and clients, over harassment or discrimination by your employees. It exists because general liability policies exclude those two causes of action. Many EPLI policies omit it until you request it, and it arrives in one of two ways:

1. A separate insuring agreement with its own limit, the more common form.
2. An endorsement that shares the main policy limit, used by a substantial minority of insurers.

Ask which one you are buying, because a shared limit means a rider claim and a driver claim in the same year draw on the same money. Allegations of physical or sexual abuse of a rider are a different exposure, handled by abuse and molestation coverage.

How the policy is written

EPLI is sold as a standalone policy or inside a management liability package with directors and officers coverage. Either way, two terms shape what you really have:

• Claims-made. The policy responds to claims first made during its term, so a lapse or a switch in insurers needs an extended reporting period or a matching retroactive date.
• Shrinking limits. Defense costs, often a large part of a claim, are paid from the limit. A $1 million policy that spends $300,000 defending a case has $700,000 left for a settlement, as an example. General liability usually pays defense on top of its limit.

Hours on record

Because wage and hour claims usually fall outside EPLI, your own records are the defense. HealthRide’s driver reports include timecards and an hours export for every driver, so each shift’s hours are on file when a question comes up.